This is amazing and a caution for those who own mineral rights. Not once, but THREE times last week, I discovered that an oil company operator is either not paying me right or not paying me at all! I have many properties all over the USA which I have accumulated over a long period of time. Here are the stories.
Story 1 -- A lady called me and wanted to buy her mineral rights in Colorado. We came to an agreement and I bought her out. I sent the paperwork to the operator (a very large global company), and they began paying me. No problems. Then, months later, the brother decided he wanted to sell. We made a deal, I bought him out and sent the operator the papers. But this time, it had changed hands and was owned by a small operator. After about three months, it dawned on me that I was not receiving royalties for the brother's part. I notified them and found out that they had been continuing to send the royalties to the brother! He didn't tell me and they didn't either. If I had not caught it, they would STILL be sending him the checks. I showed them copies of my letter from months ago. Oops, she said, okay, we'll start paying you. I said, Fine, but you have to pay me my back royalties, too, you made the mistake! She said, Well, we can't pay you for what somebody else has already received. I said Au Contrare! Yes, you can and yes, you will, that's MY money! Just because your company goofed up is not my concern! So, now we have a battle going on. I'll get the money.
Story 2 -- Similar situation. Somebody in Texas wanted me to buy them out. I did so, sent the papers to the operator. That was months ago. This past week, another member of the seller's family notified me that he had received his first check. I told him I had not even received a division order! So, I notified the company, another huge company. Oops, the landman said, I guess we made a mistake and missed that deed. So, they had sent a division order and check to the previous owner!
Story 3 -- About five years ago, I bought an interest in Louisiana. About three years ago, they drilled the tract and I have been receiving royalties ever since. Now, the operator notifies me that they had missed a deed where I sold part of my interest. (I sent them copies way back when.) So, all of this time, they have been overpaying me. Reason I didn't catch it is because the title on that deal is a can of worms, it's complicated. But it's simple for them to simply transfer a portion of whatever I owned to the man I sold part of my interest to. But, they missed it. I own a lot of properties, it's hard to keep up with all of this! But, I do try to monitor things. Bottom line is they are going to have to deduct years of royalties from my account because I want them to pay my grantee what he is owed and make him whole. Good news is they agreed to do so.
So, lesson learned is that one has to be careful! As for me, just more proof that managing producing minerals is a never-ending battle to be paid correctly!